Self Clearing Firms

Can a firm negotiate a per stock, per side, per day, clearing arrangement?

Sorry, but a simple "yes" or "no" is not known (at least to me). I assume that anything can be negotiated, but most of those type of arrangements result in "per trade" or "ticket" charges, and are generally too high for consideration, and are generally related to retail orders (which can be traded against or sold).

Regarding the BP cutbacks and layoffs, I stand by my statements...and yet, will state that there may some firms out there unknown to me who may be trying this model (I can only answer from my direct knowledge, and heck, I don't know every firm out there...but I do know the major players).
 
Just being a curious George here...What kind of volume/size do your traders do who pay "less than .3 cents per share?"

According to my calculator a guy would have to average 8400 share trades to pay under .003. How many folks do you have that average 8400 shares a trade? And does this include ECN fees if applicable? All the traders I know who previously used the cap (before decimalization, Direct+, ECNs, and increased fragmentation) rarely use it now. I can't believe there are that many traders, other than position traders who are a minute minority, who still benefit from the cap. Just wondering...Thx
 
There are firms here in NYC that charge that amount and even under that.. I work for one.. the fees include ECN , SEC taxes, SOES functions and Give Up fees... Depending on your entry and exit strategies.. the fees could possibly be negative.. which in case would lower the whole fee to way under .004
 
that you ain't buying, Don?
Let's all be specific, please.

F1: what's the firm you trade at?

I and probably everyone else likes to know the real scoop.
so lets name 'em.

Do it for the board.
 
Don, I am again going to direct this one to you. I appreciate you responding to my questions and hope you are not tired of it yet. You are the only IB that seems to want to weigh in on the subject and as most of the members know you have a lot of industry knowledge.

The prop. firm I traded at previously did not charge its traders commissions. Traders are employees and are paid a % of net profit after passthru and SEC fees. Traders receive liquidity credits for posting bids/offers on the various ECNs and this is deducted directly from passthrus, so it is in effect possible to have negative passthru fees.

My question is ; (just like the T.V. show asks)

"How'd they do that?" (charge zero commissions that is)

I would also add that, most of the traders trade very large daily volumes and the firm is quite happy with that, in fact they encourage it. The most profitable traders are generally some of the biggest volume guys, the firm loves it! They don't penalize guys for trading too much and some of the guys who are taking home the biggest monthly paychecks make such a small per share profit that it would make most on the board choke. These guys make money because they trade such large monthly volumes that even the low profit per share adds up over many millions of shares per month when you only have to deduct passthru and ECN fees.

One note before guys start asking me which firm I used to work at...... besides the fact that I no longer work there and do not care send any prospective traders their way, I also signed a confidentiality agreement and I am honoring that agreement. So unfortunately for those of you out there that are curious this firm shall remain nameless.

MACD
:p
 
Some of the numbers being thrown around on this thread have gotten me very curious. Please answer a few questions for me.
1) What is the average monthly volume for a very big trader at your firm? ( By big I mean in volume #'s not $).
2) What would a guy like this be paying per share and for ECN's?
3) Does he keep all his profits or is there a split?
 
The name of the firm was Tradescape, and nope that wasn't it .....but I suppose even if you did guess right I couldn't say so.

My original answer was referring to the ECN's that the traders receive liquidity credits from.
 
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